101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB1551

 

Introduced 2/15/2019, by Sen. Jil Tracy

 

SYNOPSIS AS INTRODUCED:
 
New Act
15 ILCS 405/6.01  from Ch. 15, par. 206.01
25 ILCS 155/4  from Ch. 63, par. 344

    Creates the Long-Term Accounting Act. Provides that the purpose of the Act is to improve transparency and accountability during the State budget process. Contains provisions concerning the passage of appropriation bills and the electronic publication of appropriation bills. Amends the State Comptroller Act. Provides that accounting standards and principles established by the Comptroller shall be compatible with generally accepted accounting standards and principles for government as prescribed by the Governmental Accounting Standards Board. Amends the Commission on Governmental Forecasting and Accountability Act. Provides that the Commission on Governmental Forecasting and Accountability must publish fiscal budget statements. Sets forth the requirements for the fiscal budget statements. Contains other provisions. Effective immediately.


LRB101 09610 RJF 54708 b

 

 

A BILL FOR

 

SB1551LRB101 09610 RJF 54708 b

1    AN ACT concerning State government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 1. Short title. This Act may be cited as the
5Long-Term Accounting Act.
 
6    Section 5. Legislative intent. It is the intent of the
7General Assembly to improve transparency and accountability
8during the State budget process by:
9    (1) confirming and strengthening the State's special
10responsibility to disclose its actions and results of those
11actions in a timely and useful way;
12    (2) establishing the concept that State budgeting
13disclosures and financial reporting are created primarily for
14the purpose of informing the public of government activity and
15creating widespread understanding of these actions;
16    (3) adopting the use of consolidated budget documents to
17facilitate the public's ability to understand the State's
18annual and accumulated shortfalls despite the relative scale of
19the State's financial operations and the volume and complexity
20of budget and financial data;
21    (4) establishing the State's duty to report the best
22estimate of its own financial condition;
23    (5) requiring a comprehensive indication of the total

 

 

SB1551- 2 -LRB101 09610 RJF 54708 b

1activity of government and the long-term effects of current
2policy;
3    (6) calling for the calculation of the long-term financial
4implications to the State and others of the budgetary
5decisions;
6    (7) providing the full-cost information necessary to
7accurately calculate performance measurements;
8    (8) establishing definitions of existing statutory
9language to strengthen the Governor's and the General
10Assembly's ability to determine compliance with the intent of
11Section 2 of Article VIII of the Illinois Constitution
12requirement, which is to preserve intergenerational equity;
13    (9) requiring explicit disclosure and accurate reporting
14by the Governor and the General Assembly of:
15        (A) debt incurred to fund current operating expenses;
16        (B) current and past costs shifted to future budgets
17    and imposed upon future taxpayers;
18        (C) State obligations, including, but not limited to,
19    current and future personnel benefit costs and
20    lapse-period expenditures; and
21        (D) any fiscal deficit in terms of the excess of full
22    accrual expenses over full accrual revenues, as well as any
23    budget surplus in terms of the excess of full accrual
24    revenues over full accrual expenses, at the time the final
25    budget is sent to the Governor;
26    (10) calling for the Governor and the General Assembly to

 

 

SB1551- 3 -LRB101 09610 RJF 54708 b

1determine if future budgetary resources will likely be
2sufficient to sustain public services and to meet obligations
3as they come due;
4    (11) acknowledging costs when incurred during the budget
5year regardless of when they are paid;
6    (12) injecting the expertise and knowledge of the State
7Comptroller's Office into the preparation of budget
8calculations;
9    (13) unveiling the State's unusual reliance upon the use of
10more than 600 special funds;
11    (14) requiring the Annual Budget and the State's
12Comprehensive Annual Financial Report to be prepared to
13facilitate a simple comparison of budgeted amounts to the
14actual amounts spent and received;
15    (15) requiring State agencies to report to the Comptroller
16all fiscal information necessary to prepare a comprehensive
17annual financial report in a timely manner; and
18    (16) mandating the production of the State's Comprehensive
19Annual Financial Report within 6 months after the end of the
20State's fiscal year.
 
21    Section 10. Definitions. As used in this Act:
22    "Amounts due to pension funds" means the unfunded actuarial
23accrued liability for the State pension plans, including the
24portion of multiple-employer plans attributed to the State.
25    "Benefit enhancements" means the actuarial present value

 

 

SB1551- 4 -LRB101 09610 RJF 54708 b

1of total projected benefits attributed to the estimated
2increase in the benefits of retirees or beneficiaries granted
3by the proposed budget or proposed or enacted changes to the
4Illinois Pension Code. The benefit enhancements that result
5from plan members' expected future service amount may be
6reduced by the amount of specified revenue sources enacted into
7law.
8    "Capital assets" shall be defined using Governmental
9Accounting Standards Board concepts outlined in Governmental
10Accounting Standards Board Statement 34.
11    "Comptroller's budget statements" means the estimated
12balance sheet, the estimated statement of activities, and the
13estimated statement of cash flow.
14    "Estimated balance sheet" means the estimated statement of
15net assets prepared using the Governmental Accounting
16Standards Board concepts outlined in Governmental Accounting
17Standards Board Statement 34.
18    "Estimated retirement plans' assets gain or loss" means the
19change in the actuarial value of assets from the beginning of
20the budget period to the end of the budget period.
21    "Fiscal budget statements" means the estimated statement
22of fiscal balance, the estimated statement of fiscal deficit,
23and the estimated financial state of the State.
24    "Fiduciary funds" shall be defined using Governmental
25Accounting Standards Board concepts outlined in Governmental
26Accounting Standards Board Statement 34.

 

 

SB1551- 5 -LRB101 09610 RJF 54708 b

1    "Government-Wide Generally Accepted Accounting Principles"
2means the accounting standards used in the preparation of the
3State's government-wide financial statements, using
4Governmental Accounting Standards Board concepts outlined in
5the Governmental Accounting Standards Board Statement 34.
6While the Governmental Accounting Standards Board does not
7prescribe standards for preparing governmental budgets, the
8accounting standards' concepts shall be applied to the fiscal
9budget statements prepared under this Act.
10    "Increase or Decrease in Other Post Employment Benefits
11Due" means the change in the State's Other Post Employment
12Benefits plans' estimated actuarial accrued liability from the
13beginning of the budget period to the end of the budget period.
14    "Increase or Decrease in Pension Benefits Due" means the
15change in the State's pension plans' estimated actuarial
16accrued liability at the beginning of the budget period and the
17sum of each pension plan's estimated actuarial accrued
18liability at the end of the budget period.
19    "Net Pension Obligations or Assets", "Net Other Post
20Employment Obligations Assets", "Actuarial Value of Assets",
21"Actuarial Accrued Liability", "Unfunded Actuarial Accrued
22Liability", and "Actuarial Present Value of Total Projected
23Benefits" shall be defined using Governmental Accounting
24Standards Board concepts outlined in Governmental Accounting
25Standards Board Statements 25, 27 as amended by Statement 50,
26and 45.

 

 

SB1551- 6 -LRB101 09610 RJF 54708 b

1    "Off Balance Sheet Other Post Employment Benefit
2Liabilities" means the difference between the State Other Post
3Employment Benefit Plans' estimated unfunded actuarial accrued
4liability and the estimated Net Other Post Employment Benefit
5Obligations or Assets included in the estimated balance sheet.
6    "Off Balance Sheet Pension Liabilities" means the
7difference between the State pension plans' estimated unfunded
8actuarial accrued liability and the estimated net pension
9obligations or Assets included in the estimated balance sheet.
10    "Retirees' health care benefits" means the unfunded
11actuarial accrued liability for the State Other Post Employment
12Benefit plans, including the portion of multiple-employer
13plans attributed to the State.
14    "State Other Post Employment Benefit Plans" include the
15State's Single-Employer Other Post Employment Benefit plans,
16and also include the portion of Agent Multiple-Employer Other
17Post Employment Benefit plans attributed to the State.
18    "State pension plans" means the State's single-employer
19pension plans and the portion of agent multiple-employer
20pension plans attributed to the State.
 
21    Section 15. Electronic publication of appropriation bills;
22publication deadlines with respect to second and third
23readings. The General Assembly shall publish, on a web page
24controlled by the General Assembly, the texts of all
25appropriations bills. Each publication shall include an

 

 

SB1551- 7 -LRB101 09610 RJF 54708 b

1embedded time stamp setting forth the time of electronic
2publication. No amendment to an appropriation bill shall be
3considered on second reading until at least 72 hours after the
4amendment has been published electronically and no bill to
5appropriate funds shall be passed on third reading until at
6least 72 hours after the time of electronic publication in
7final form.
 
8    Section 20. Passage of appropriation bills prohibited
9before adoption of joint resolution. The General Assembly shall
10not enact any bill to appropriate funds within any fiscal year
11prior to its adoption of a joint resolution reflecting the
12estimate of funds available for that fiscal year as required
13under Section 4 of the Commission on Government Forecasting and
14Accountability Act.
 
15    Section 25. State funds as fiduciary funds. All State funds
16shall be fiduciary funds unless explicitly provided otherwise
17by law.
 
18    Section 100. The State Comptroller Act is amended by
19changing Section 6.01 as follows:
 
20    (15 ILCS 405/6.01)  (from Ch. 15, par. 206.01)
21    Sec. 6.01. Specification and establishment of accounting
22standards and principles. The Comptroller shall specify and

 

 

SB1551- 8 -LRB101 09610 RJF 54708 b

1establish the financial accounting and reporting standards and
2principles to be used by all State government and State
3agencies. The standards and principles shall be effective upon
4filing by the Comptroller with the Auditor General. The
5Comptroller shall maintain and publish the standards and
6principles as a public document. These standards and principles
7shall be known as the Generally Accepted Accounting Standards
8and Principles for Illinois State Government, and shall be
9compatible with generally accepted accounting standards and
10principles for government as prescribed by the Governmental
11Accounting Standards Board , whenever possible, be compatible
12with any similar nationally existing generally accepted
13accounting standards and principles for government.
14    In establishing the Generally Accepted Accounting
15Standards and Principles for Illinois State Government, the
16Comptroller shall consult with the Governor and the other
17members of the Executive Branch, the Chief Justice of the
18Supreme Court, and the leadership of the General Assembly and
19shall provide to these officials, and publish on the
20Comptroller's website, draft copies of any proposed standards
21at least 90 days prior to their adoption and shall consider any
22responses or suggestions that these officials or the public may
23present.
24(Source: P.A. 86-1415.)
 
25    Section 105. The Commission on Government Forecasting and

 

 

SB1551- 9 -LRB101 09610 RJF 54708 b

1Accountability Act is amended by changing Section 4 as follows:
 
2    (25 ILCS 155/4)  (from Ch. 63, par. 344)
3    Sec. 4. (a) The Commission shall publish, at the convening
4of each regular session of the General Assembly, a report on
5the estimated income of the State from all applicable revenue
6sources for the next ensuing fiscal year and of any other funds
7estimated to be available for such fiscal year. The Commission,
8in its discretion, may consult with the Governor's Office of
9Management and Budget in preparing the report. On the third
10Wednesday in March after the session convenes, the Commission
11shall issue a revised and updated set of revenue figures
12reflecting the latest available information. The House and
13Senate by joint resolution shall adopt or modify such estimates
14as may be appropriate. The joint resolution must include all
15applicable revenues and other funds available. The joint
16resolution shall constitute the General Assembly's estimate,
17under paragraph (b) of Section 2 of Article VIII of the
18Constitution, of the funds estimated to be available during the
19next fiscal year. The report must estimate all applicable
20revenues and must estimate other funds available. The report
21shall clearly separate and distinguish all applicable revenues
22and other funds available when estimating the funds estimated
23to be available for purposes of calculating funds estimated to
24be available as required under subsection (b) of Section 2 of
25Article VIII of the Illinois Constitution.

 

 

SB1551- 10 -LRB101 09610 RJF 54708 b

1    (a-5) The annual March estimates issued by the Commission
2shall include an estimated balance sheet, an estimated
3statement of activities, and an estimated statement of cash
4flow. The March estimates shall include a variance report of
5the ongoing fiscal year's budget and appropriations.
6    (a-10) The Commission shall also prepare:
7        (1) The estimated statement of fiscal balance, which
8    shall include:
9            (A) The columns used in the estimated balance
10        sheet.
11            (B) The total net assets, as determined in the
12        estimated balance sheet.
13            (C) The off-balance sheet pension liability.
14            (D) The off-balance sheet Other Post Employment
15        Benefit liability
16            (E) The resulting fiscal balance.
17        (2) The estimated statement of fiscal deficit, which
18    shall include:
19            (A) The columns used in the estimated statement of
20        activities.
21            (B) The change in net assets, as determined in the
22        estimated statement of activities.
23            (C) Benefit enhancements.
24            (D) Retirement plans' assets gain or loss.
25            (E) Increases or decreases in pension benefits
26        due.

 

 

SB1551- 11 -LRB101 09610 RJF 54708 b

1            (F) Increases or decreases in Other Post
2        Employment Benefits due.
3            (G) The resulting fiscal deficit.
4        (3) The estimated financial state of the State, which
5    shall include:
6            (A) Amounts reported on the State's Comprehensive
7        Annual Financial Report for the State fiscal year 2
8        years prior to the current budget year.
9            (B) The estimated values from last period's
10        budget.
11            (C) The estimated values from the current budget
12        period.
13            (D) What the State owns:
14                (i) Capital assets.
15                (ii) Other assets that are derived from the
16            total assets reported on the statement of net
17            assets/balance sheet minus capital assets.
18                (iii) State assets shall equal the total
19            assets.
20            (E) What the State owes:
21                (i) The amount of State bonds, including, but
22            not limited to, General Obligation Bonds and
23            Special Revenue Bonds.
24                (ii) Amounts due pension funds.
25                (iii) Retirees' health care benefits Other
26            Post Employment Benefit.

 

 

SB1551- 12 -LRB101 09610 RJF 54708 b

1                (iv) Other liabilities that are derived by
2            subtracting the State bonds, the net pension
3            obligation, and the net Other Post Employment
4            Benefit obligation from the total liabilities
5            reported on the statement of net assets/balance
6            sheet.
7                (v) State bills.
8            (F) Where the State stands:
9                (i) Illinois' financial position.
10                (ii) Each Illinois family's share, which is
11            derived by dividing Illinois' financial position
12            divided by the Illinois population estimate as
13            determined by the U.S. Census Bureau divided by the
14            national average size of a family as determined by
15            the U.S. Census Bureau.
16    (a-20) In conjunction with the State Comptroller, the
17Commission shall publish the fiscal budget statements outlined
18in subsection (a-5) in concert with Government Wide-Generally
19Accepted Accounting Principles. The fiscal budget statements
20shall include information about the State as a whole. The
21fiscal budget statements should include the primary government
22and its component units, except for the fiduciary funds of the
23primary government and component units that are fiduciary in
24nature. The fiscal budget statements shall be prepared using
25the economic resources measurement focus and the accrual basis
26of accounting. The fiscal budget statements shall not be

 

 

SB1551- 13 -LRB101 09610 RJF 54708 b

1presented using the current financial resources measurement
2focus and the modified accrual basis of accounting, which are
3used to prepare the State's governmental funds financial
4statements. The Commission shall obtain from each of the
5State's pension and Other Post Employment Benefit plans'
6actuaries to determine the pension and Other Post Employment
7Benefit amounts needed to prepare the fiscal budget statements.
8    (b) On the third Wednesday in March, the Commission shall
9issue estimated:
10        (1) pension funding requirements under P.A. 86-273;
11    and
12        (2) liabilities of the State employee group health
13    insurance program.
14    These estimated costs shall be for the fiscal year
15beginning the following July 1.
16    (c) The requirement for reporting to the General Assembly
17shall be satisfied by filing copies of the report as required
18by Section 3.1 of the General Assembly Organization Act, and
19filing such additional copies with the State Government Report
20Distribution Center for the General Assembly as is required
21under paragraph (t) of Section 7 of the State Library Act.
22    (d) For each fiscal year, the General Assembly shall adopt
23a joint resolution accepting the amounts reported on the fiscal
24budget statements.
25    (e) For the purposes of this Section, "all applicable
26revenues" means "own source revenues", including:

 

 

SB1551- 14 -LRB101 09610 RJF 54708 b

1        (1) personal income tax;
2        (2) corporate income tax;
3        (3) corporate personal property replacement tax;
4        (4) sales tax retained by the State;
5        (5) excise taxes, such as excise taxes on alcohol,
6    gasoline, or energy;
7        (6) user fees;
8        (7) fines and penalties;
9        (8) gaming taxes;
10        (9) investment income;
11        (10) unencumbered funds provided by other governmental
12    units; or
13        (11) any other revenue source for which the State has
14    no ongoing or unfulfilled obligation to any other party.
15    For the purposes of this Section, "other funds available"
16means:
17        (1) funds that result from the actions of another
18    entity or government;
19        (2) funds received that are held in trust or have a
20    fiduciary element;
21        (3) pass-through funds or funds received by the State
22    when acting as an agent or collector for another entity;
23        (4) pension contributions made by State employees not
24    used to pay pensions or used to purchase assets for the
25    State's pension funds;
26        (5) that portion of sales tax collections that

 

 

SB1551- 15 -LRB101 09610 RJF 54708 b

1    retailers pay to the State but that will be remitted to
2    home rule and local governments;
3        (6) court-ordered collections of child support;
4        (7) inter-period borrowings;
5        (8) prepaid tuition plans; or
6        (9) any other source of funds for which the State has
7    an unfulfilled or ongoing obligation.
8    The definitions set forth in Section 10 of the Truth in
9Accounting Act of 2010 are incorporated.
10(Source: P.A. 100-1148, eff. 12-10-18.)
 
11    Section 999. Effective date. This Act takes effect upon
12becoming law.